If you offer insurance replacement rentals, you’ve got a pretty good idea of how long those units are on rent. But you may have been in the dark on how your length of rental (LOR) stacks up against averages for replacement rentals in your state, other states and the U.S. - until now.
Enterprise Rent-A-Car supplied Auto Rental News with information from its Automated Rental Management System (ARMS) for average LOR for insurance-paid rentals by state. The numbers, based on millions of claims in the third quarter of 2012, include insurance-paid rentals for direct and non-direct repair estimates, including independent appraisers and staff appraisers.
Overall U.S. length of rental (LOR ) for the third quarter of 2012 averaged 10.8 days. Photo courtesy of Enterprise Rent-A-Car.
Enterprise publishes this report every quarter. According to Frank LaViola, assistant vice president at Enterprise, “Enterprise Rent-A-Car first started publishing this report to give body shops much-needed information to improve performance where needed or to highlight their cycle times when they are below the market averages. Within the ARMS application, shops can compare their performance to other shops within their market as well as sort their results by insurance company.”
The report includes 49 of the 50 states, excluding Hawaii because of significant differences in per-island data.
This data was used by Mitchell International Inc. in its first quarter Industry Trends Report, a snapshot of the auto physical damage collision and casualty industries. Through its collision claims management software, Mitchell processes millions of transactions annually for insurance companies and claims payers for collision repair facilities. The report is authored by Greg Horn, vice president of industry relations for Mitchell.
Rankings By Nation And Region
According to Enterprise, over the past five years, third-quarter LOR has averaged 10.58 days nationwide, with a low of 10.02 days in 2009. The map above reveals an average LOR of 10.8 days for the nation in the third quarter of 2012. This number was previously reached in 2011 and 2008.
In general, several factors — including weather, climate, economics, parts availability, individual shop conditions and the age of vehicles — all play a role in LOR. Differences in frequency and severity of weather events generally account for year-over-year variations in LOR. This was the case in the third quarter of 2012, as a handful of severe regional storms helped to offset the mostly uneventful summer weather throughout the rest of the country.
Enterprise subsequently published information on LOR for the fourth quarter of 2012. Generally, LOR increases in the fourth quarter as weather worsens, and 2012 was no exception: Average LOR for the U.S. increased from 10.8 days in Q3 to 11 days in Q4. However, when looking year-over-year, average LOR for Q4 2012 decreased 0.1 days compared to 2011.
By region, the effects of Hurricane Sandy impacted LOR in the Northeast in Q4, which nonetheless ended up lower than the fourth quarter in 2011. However, this reversed the trend from the third quarter of 2012, when the Northeast had the sharpest decline in LOR of all regions. In relation to Hurricane Sandy, the number of claims involving “total loss vehicles” is not used in these LOR calculations.